Huntsville Metro Area Report

Alabama Business Confidence Index™

Fourth Quarter 2021

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Moderately Strong Metro Business Confidence in Q4 2021

Though the metro ABCI decreased heading into Q4 2021, Huntsville business leaders are continuing to forecast economic growth. This is according to the latest survey from the Alabama Business Confidence Index (ABCI). The metro’s ABCI registered at a moderately confident 58.8 this quarter, down 7.6 points from Q3 2021. Despite all of the component indexes decreasing this quarter, all of the industry indexes registered above 59, indicating moderate to strong confidence for Huntsville’s industry growth. However, area panelists are less sure of growth in the U.S. economy this quarter with a neutral index of 49.5.

Fourth Quarter 2021 Outlook

Huntsville Statewide
ABCI 58.8 58.0
Alabama Economy 61.5 58.9
US Economy 49.5 50.7
Industry Sales 59.6 60.6
Industry Profits 59.6 56.6
Industry Hiring 64.9 62.0
Industry Capital Expenditures 57.7 59.2

Index above 50 indicates positive outlook as compared to last quarter.
Index below 50 indicates negative outlook compared to last quarter.

Huntsville Component Index Analysis

  • Alabama Economy: Despite a 13.5-point decrease from the previous quarter’s very confident index, metro business leaders are continuing to forecast improved statewide conditions with a strongly positive index of 61.5.
  • US Economy: This quarter, Huntsville business leaders are anticipating a continuation of last quarter’s U.S. conditions. The index dipped below 50 to register at a neutral 49.5 in Q4 2021 after decreasing 16.4 points.
  • Industry Sales: The metro sales index forecasts growth this quarter with a moderately positive index of 59.6. This is 6.8 points below the Q3 2021 sales index but still indicates confident expectations for growth.
  • Industry Profits: Area business leaders expressed moderate optimism in increased profits this quarter. The index decreased 2.9 points to also register at 59.6 for Q4 2021.
  • Industry Hiring: Industry hiring is forecast to increase this quarter with a strongly confident index of 64.9 after a 1.9-point decrease from Q3 2021. Huntsville’s hiring index communicated the strongest confidence of any metro’s component indexes this quarter.
  • Industry Capital Expenditures: The metro’s capital spending index registered at a moderately confident 57.7 for the quarter. This is a 3.9-point decrease from the previous quarter’s index.

 

Huntsville Response Breakdown

Historical Huntsville ABCI™ and Industry Component Indexes

ABCI Huntsville in Context

With a Q4 2021 index of 58.8, Huntsville business leaders are expecting another quarter of economic growth with slightly less confidence than in Q2 and Q3 of 2021. Despite the uncertainty introduced by the COVID-19 and the Delta variant, metro panelists have continued to forecast growth with moderate to strong confidence over the last six quarters. In the three years before the pandemic, Huntsville’s business leaders felt strongly confident forecasting growth, with an average ABCI of 63.2 from Q1 2017 to Q1 2020.

Though business confidence decreased from the third quarter levels across the state’s metro areas, ABCI panelists are still forecasting growth in Q4 2021. The metro’s hiring indexes were all above 57, indicating sustained expectations for increased hiring despite the higher levels of uncertainty that are reflected in the other indexes. Tuscaloosa had the highest index with a strongly confident ABCI of 60.9, followed by Huntsville at a more moderate 58.8, Mobile at 56.6, and Montgomery at 55.9. Birmingham-Hoover had the lowest metro ABCI this quarter at a mildly positive 54.2.

ABCI™ by Metro Area

Huntsville ABCI™ Compared to Statewide ABCI™

 

The Center for Business and Economic Research would like to thank the Alabama business executives who completed the fourth quarter 2021 ABCI™ survey. This is the 80th consecutive quarter this report has been recorded, and it would not have been possible without your participation.
Be sure to log in during the December 1–15 survey window to record your opinions about economic prospects and industry performance looking ahead to the first quarter of 2022.

 

  &  Logo of the Birmingham Business Alliance

This report was produced in partnership between the Center for Business and Economic Research at the The University of Alabama’s Culverhouse College of Business and the Huntsville Area Chamber of Commerce.

Analysis provided by Susannah Robichaux, Socioeconomic Analyst, Center for Business and Economic Research, Culverhouse College of Business, The University of Alabama.

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